DME Development Raises ₹775 Crore Through Green Bonds in Road Infrastructure Sector

Proceeds to Fund Sustainable Infrastructure Initiatives on Delhi-Mumbai Expressway, Marking a New Milestone in Green Financing.

In a groundbreaking development for the Indian road and highway infrastructure sector, DME Development Limited (DMEDL), a wholly-owned subsidiary of the National Highways Authority of India (NHAI), has successfully raised ₹775 crore through the issuance of ‘Green Bonds’. This marks the first instance of such financing in the sector, aimed at integrating sustainability into infrastructure growth.

The green bonds, issued under a closed bidding system, garnered a strong response from the investment community. With a base size of ₹500 crore and a green-shoe option to retain oversubscription of up to ₹275 crore, the issue achieved a yield of 7.23% per annum.

Expressing his gratitude, NHAI Chairman Shri Santosh Kumar Yadav, IAS, remarked: “This initiative represents a significant milestone for the roads and highways sector. The overwhelming response from investors underscores their confidence in our approach to balancing infrastructure development with environmental sustainability. I thank all investors for supporting this unique offering, which sets a benchmark for future endeavors.”

Shri NRVVMK Rajendra Kumar, Member (Finance), NHAI, and Chairman, DMEDL, added: “The success of the green bonds issuance reflects the trust investors have in our vision for holistic development. The proceeds will not only finance critical infrastructure but also ensure environmentally sustainable practices, reinforcing our commitment to long-term growth.”

Sustainable Applications of the Proceeds

The funds raised through the green bonds will be channeled into eco-friendly initiatives, including:

• Avenue and median plantations.
• Construction of animal underpasses to protect wildlife habitats.
• Development of natural stormwater drainage systems.
• Installation of streetlights powered by renewable solar energy.
• Implementation of waste recycling and reuse mechanisms.
• Deployment of rainwater harvesting systems to promote water conservation.

These initiatives aim to ensure that the Delhi-Mumbai Greenfield Expressway aligns with global environmental standards while addressing India’s infrastructure needs.

DMEDL’s Role in Sustainable Infrastructure

Established in August 2020, DME Development Limited (DMEDL) is a Special Purpose Vehicle (SPV) under NHAI, responsible for financing, constructing, and operating the Delhi-Mumbai Greenfield Expressway. The organization has received the highest AAA credit rating from CRISIL, CARE, and India Ratings, underscoring its financial reliability.

DMEDL is targeting to raise ₹48,000 crore through loans and bonds for the expressway project. To date, it has successfully mobilized ₹43,000 crore. The Delhi-Mumbai Expressway, a flagship project, is expected to revolutionize connectivity across India’s economic hubs while adhering to sustainability principles.

Future Implications of Green Financing

The issuance of green bonds marks a transformative step in India’s infrastructure financing. By integrating Environmental, Social, and Governance (ESG) considerations into its projects, DMEDL is not only addressing current environmental challenges but also setting a precedent for sustainable infrastructure development across the country.

With growing global emphasis on sustainable development, DMEDL’s green bonds could inspire similar initiatives in other sectors, further solidifying India’s position as a leader in sustainable infrastructure.